Accretion/Dilution Exercise Instructions

Determine the maximum premium Coca-Cola could pay for Canada Dry before the deal would no longer be accretive based on the data
listed in Exhibit 1 below.
Fill in Coca-Cola's current stock price on the DILUTION ANALYSIS worksheet.
Fill in Coca-Cola (NYSE: KO) shares outstanding on the DILUTION ANALYSIS worksheet.

Exhibit 1
Coca-Cola
Summary of assumptions for Acquisition (MM)

Buyer
Coca-Cola
Coca-Cola Stock Price - Current $47.18 as of COB 3/17/2020*
Coca-Cola Shares Outstanding 4,293.34 4,293,340,000 shares outstanding (mkt cap: 202.56B)
Coca-Coal Revenues $47,915.00
Coca-Cola Net Income $8,716.00
Borrowing Cost 5.00%

Target
Canada Dry
Revenues $6,000.00
EBITDA $1,510.00
EBIT $1,450.00
Book Value $2,100.00
Total Debt $1,300.00
Share Price $56.00
Shares Outstanding 166

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 Accretion/Dilution Anaysis

ASSUMPTIONS
Purchase Price $13,665.1
% Cash 0.00%
Coca-Cola Stock Price $47.18
Target Book Value $2,100.0
Goodwill Created $10,265.1
Target Total Debt $1,300.0
Synergies Assumed $500.0
Shares Issued 289.64

Current

Coca-Cola
Sales $47,915.0
Net Income 8,716.0
Shares Outstanding 4,293.3
EPS $2.03

Canada Dry
Sales $24,058.4
EBITDA 1,510.0
EBIT 1,450.0
Less Tax Effect 507.5
Effective Net Income $942.5

Monster and Swift Combined

Sales 71,973.4
Net Income Before Transaction Adjustments 9,658.5
Adjustments:
Synergies Assumed (Net of Taes) 325.0
Interest Expense on New Debt 0.0
Amortization of Goodwill (684.3)
Gross Adjustments (359.3)

Reduction in Taxes 0.0

Net Adjustments (359.3)

Adjusted Net Income $9,299.2

Shares Outstanding, Pro Forma 4583.0
Adjusted EPS $2.03

Percentage Accretion / (Dilution) (0.1)%

Acquisition EBITDA Multiple 9.9 x